Petaluma Municipal Code Ch. 6.16 Bankruptcy Sales

For the purposes of this chapter, the following words and phrases shall have the meanings respectively ascribed

to them by this section:

A. "Advertise" means any and all means, whether verbal or written, used for conveying to the public or any part

thereof, notice of the conduct of a closeout sale, Rre sale or bankruptcy sale as deRned in this section, or notice of

intention to conduct such sale;

B. "Bankruptcy sale" means any sale of, or oUer to sell, to the public or any part thereof, goods, wares or

merchandise in stock which have been involved in any business failure or have been derived from any business

which has been adjudicated bankrupt, has been closed, has been discontinued, has been liquidated or has been

placed in receivership;

C. "Close-out sale" means any sale of, or oUer to sell to the public or any part thereof, goods, wares or

merchandise in stock, in furtherance of a declared purpose, as advertised, when such sale is anticipatory of or to

avoid the termination, liquidation, revision, windup, discontinuance, removal, relocation, dissolution, closing or

abandonment of a business conducted at any location;

D. "Fire sale" means any sale of, or oUer to sell to the public or any part thereof, goods, wares or merchandise in

stock which has been damaged as the result of contact with, or exposure to, Rre, smoke or water;

E. "Permit" means a permit issued pursuant to this chapter;

F. "Permittee" means any person, Rrm, association or corporation to whom a permit has been issued pursuant

to this chapter;

G. "Person" means an individual, Rrm, association, corporation or partnership, or the agent of any of the

aforesaid.

The subsections of this section deRning bankruptcy sale, close-out sale and Rre sale shall apply to any and all sales

advertised in such manner as to convey to the public, or to that portion of the public to which such advertising is

directed, the belief that upon disposal of the goods to be placed on sale, the business or that portion thereof

being conducted at any location will cease, be removed or relocated. (Ord. 850 NCS §1; prior code §5.28.)

It is unlawful for any person to advertise or otherwise represent to the public or any part thereof, in any manner, a

reduction in price of any goods, wares, merchandise, service, facility or accommodation, whether such price

reduction be represented in complete price Rgures or by percentage reduction, unless the price from which the

reduction is calculated is the price customarily charged by applicant for the goods, wares, merchandise, service,

facility or accommodation so oUered to the public. (Ord. 850 NCS §1; prior code §5.29.)

It is unlawful for any person to advertise or conduct a close-out sale, Rre sale or bankruptcy sale, as deRned in

Section 6.16.010 without Rrst obtaining a permit therefor from the city tax and license collector in the manner

hereinafter provided. (Ord. 850 NCS §1; prior code §5.30.)

The provisions of this chapter shall not apply to or aUect the following persons:

A. Persons acting in their oTcial capacities as public oTcials;

B. Persons acting pursuant to process issued by a court of competent jurisdiction;

C. Duly licensed auctioneers, selling at auction other than at a closeout sale;1

D. Any publisher of a newspaper, magazine or other periodical or publication, who publishes in good faith any

advertisement without knowledge of its false, deceptive or misleading character, or without knowledge that

compliance has not been had with the provisions of this chapter.

(Ord. 850 NCS §1; prior code §5.31.)

1 Editor’s Note: Prior code §5.31(3) was amended during codiRcation in accordance with the wishes of the city

attorney in a letter dated August 3, 1972.

Any person who has held a sale, regulated under this chapter, at the same location as stated in the application,

within one year preceding the date of the application, shall not be granted a permit. (Ord. 850 NCS § 1; prior code

§5.32.)

In the event a person applying for a permit under this chapter operates more than one place of business, any

permit issued under this chapter shall apply only to the one store for which application is made, and no other

store or branch shall advertise or represent that it is cooperating with it or in any way participating in such sale,

nor shall the store at which such sale is conducted advertise or represent that any other store or branch is

cooperating with it or participating in any way in such sale. (Ord. 850 NCS §1; prior code §5.33.)

Any person desiring to advertise and conduct a sale regulated by this chapter shall make a written application

therefor, under oath, accompanied by a fee in the sum of Rfty dollars, to the city tax and license collector, setting

forth and containing the following information:

A. The true name and address of the owner of the goods, wares or merchandise to be the subject of the sale;

B. The true name and address of the person from whom the applicant purchased the goods, wares or

merchandise to be sold and the price thereof, or, if not purchased, the manner of acquisition. The price at which

such goods were oUered for sale to the public immediately prior to such application;

C. The address of the place where such sale is to be held;

D. The nature of the occupancy of applicant at that place where the sale is to be conducted whether by lease,

sublease or otherwise, and the eUective date of termination of such occupancy;

E. The dates when the sale is to be conducted;

F. A full and complete statement of the facts relating to the sale, including the reason for the urgent and

expeditious disposal of goods, wares or merchandise thereby, and the manner in which the sale will be conducted;

G. The means proposed to be employed in advertising such sale, together with the proposed content of such

advertising, if any;

H. An itemized stock list of inventory of the goods, wares and merchandise to be oUered for sale, together with

the cost at which the same were obtained by the owner thereof or the person conducting the sale. All goods,

wares and merchandise listed upon the inventory herein required shall be so described in detail by manufacturer’s name and lot number, the number of articles so described, colors, sizes and otherwise, that the

identity of such goods with the goods listed on such inventory can be readily determined.

1. All goods included in such inventory shall have been purchased by the applicant for resale on bona Rde

orders without cancellation privileges, in the ordinary course of business, and shall not comprise goods held

on consignment,

2. Such inventory shall not include goods, wares or merchandise ordered in expectation or contemplation

of conducting a sale of the type regulated hereby. Any purchase or additions to the stock of goods of the

person applying for a permit hereunder within sixty days preceding the Rling of an application for a permit

hereunder shall be presumed to be a purchase made in expectation or contemplation of a sale as herein

regulated. Such presumption may be rebutted by evidence that such purchases or additions were not made

in expectation or contemplation thereof,

3. Such inventory shall include only goods which are, at the time such inventory is taken and prepared, on

the premises of the applicant and at the location where the sale is proposed to be conducted.

(Ord. 850 NCS §1; prior code §5.34.)

Upon the Rling of the application for a permit as provided in Section 6.16.070, the city tax and license collector

shall make or cause to be made such examination, audit or investigation of the applicant and his business, history

and aUairs in relation to the proposed sale as he shall deem necessary. If the city tax and license collector Rnds

that the statements in the application are true, that the inventory is complete and accurate, that the advertising

proposed to be used is not false, fraudulent, deceptive or misleading in any respect, that purported price

reductions are bona Rde, and that the methods proposed to be used by the applicant in conducting the sale are

not such as, in his opinion, will work a fraud or deception upon prospective purchasers, he shall recommend the

issuance to the applicant of a permit to conduct such sale in conformity with the provisions of this chapter,

otherwise, he shall recommend a denial of the application. The city tax and license collector may also refuse to

issue a permit to the applicant because of the insuTciency of the information set forth in the application, but in

the event of a denial for insuTcient information the city tax and license collector shall grant the applicant

permission to Rle an amended application.

No permit may be issued to any applicant who has been convicted of any crime involving fraud or moral turpitude

within Rve years preceding application. The city tax and license collector also may refuse to issue a permit to any

person who has heretofore violated any provisions of any ordinance of the city regulating the conduct of sales of

the type herein regulated. Upon approval of the application by the city tax and license collector, the application,

together with a report of the investigation made pursuant thereto shall be sent to the city manager for approval or

disapproval. Upon approval of the application by the city manager, the city tax and license collector shall issue a

permit. In no event shall the fee of Rfty dollars be returned to the applicant. (Ord. 850 NCS §1; prior code §5.35.)

Any permit issued under this chapter shall be issued on the following terms:

A. The permit shall authorize the sale described in the application for a period not to exceed thirty consecutive

calendar days; provided, that no such sale shall commence until Rfteen days shall have passed since the applicant

shall have Rled his inventory with the city tax and license collector; and provided further, however, that the city tax

and license collector, with the approval of the city manager, may upon application therefor, accompanied by a

renewal fee of Rfty dollars renew such permit for a period not to exceed thirty consecutive calendar days. Such

application for renewal shall set forth a complete list of goods, wares or merchandise listed in the original

application which remain unsold. No goods, wares or merchandise not listed in the original application may be

sold pursuant to any renewal permit granted hereunder. Upon receipt of such application for renewal, the city tax

and license collector shall make, or cause to be made, an investigation at once, and if satisRed of the truth of the

statements made therein, shall refer the renewal application, together with the attendant investigation report, to

the city manager. Upon approval of the renewal application by the city manager, the city tax and license collector

shall issue a renewal permit. Only one renewal permit may be issued. In no event shall the fee of Rfty dollars be

returned to the renewal applicant;

B. The permit shall authorize only the one type of sale described in the application at the location therein

described;

C. The permit shall authorize only the sale of the goods, wares or merchandise described in the inventory

appended to the application;

D. Any permit or renewal thereof granted as herein provided shall not be assignable or transferable.

(Ord. 850 NCS §1; prior code §5.36.)

Any applicant to whom a permit is to be issued under the provisions of this chapter shall submit to the city tax and

license collector a corporate surety bond satisfactory to the city, payable to the city, in the penal sum of one

thousand dollars conditioned upon compliance with the provisions of this chapter. No permit shall be issued

unless and until such bond has been Rled with such oTcer of the city. (Ord. 850 NCS §1; prior code §5.37.)

A permittee under this chapter shall:

A. Make no additions or substitutions whatever to or of the stock of goods, wares or merchandise described in

the inventory attached to the application for a permit during the period subsequent to the Rling of the inventory

and prior to the termination of any sale or renewal thereof herein authorized;

B. Refrain from any false, deceptive or misleading advertising;

C. Conduct such sale in strict conformity to any advertising or holding out relating thereto;

D. Keep available at the place of sale a duplicate copy of the inventory to the application for presentation

thereof to inspecting oTcials upon request therefor;

E. At the close of business each day the stock inventory shall be revised and made current, and items on such

list disposed of during such day shall be noted thereon. Suitable books and records as prescribed by the city tax

and license collector shall be kept by the permittee and shall be open at all times to inspection by the city tax and

license collector or his authorized representatives.

(Ord. 850 NCS § 1; prior code §5.38.)

No goods, wares or merchandise shall be oUered for sale at the place of business where such sale is to be

conducted other than those items listed in the inventory Rled with the application for the permit. (Ord. 850 NCS

§ 1; prior code §5.39.)

The city tax and license collector and the chief of police or their authorized representatives shall have the power to

revoke at any time any permit granted in accordance with the provisions of this chapter whenever any such sale is

being conducted in violation of any of the provisions of this chapter, or in such a manner as to deceive or defraud

the public, or if:

A. The holder of any such permit has made any material misstatement in the application for such permit;

B. The holder of any such permit has been guilty of any fraudulent practice or practices in the conduct of the

sale authorized by such permit;

C. The holder of any such permit has failed to inventory all the goods, wares or merchandise oUered for sale

pursuant to such permit;

D. The holder of any such permit has added, or caused or permitted to be added, any goods, wares or

merchandise not described in the original inventory and has oUered such additions for sale under such permit;

E. The holder of any such permit has violated any of the provisions contained in this chapter.

(Ord. 850 NCS § 1; prior code §5.40.)